Among independent financial advisors, Mr. Feight is one of the most well known and highly respected “Fee-Only” financial planners. Since 1997, Rich has dedicated his career to offering low cost “Fee-Only” comprehensive financial planning and investment advice. Rich assists his clients in organizing their finances so that they can retire on time.Rich is a graduate of Michigan State University where he received his degree in Finance. Rich has earned the Certificate of Financial Planning from The College for Financial Planning in Denver , Colorado that was comprised of intense graduate level classes grounding him in the various foundations of financial planning. He is a CFP® (Certified Financial Planner®) since 2001, meeting the experience, education requirements and passing the two-day, 10 hour exam, making him one of the few in the country who hold the designation. Since 2003, Rich has subscribed to the stringent and mandatory annual educational hours, experience, and code of ethics to meet the requirements to be a NAPFA Registered Financial Advisor. Out of the 800,000 individuals in the country who claim they are financial advisors/planners, fewer than 1,300 in the country qualify for the membership; Rich is one of them.

Rich is the President of the Financial Planning Association (FPA) of Michigan . The FPA of Michigan is one of largest and influential chapter in the country. Rich was recently named President for Transportation Toastmasters Club 4776 downtown Lansing . He has been quoted in both local and national media from Noise Magazine to CNBC, and Bloomberg, and industry news publications such as Investment News and Financial Advisor Magazine. Rich enjoys public speaking and has spoke at industry educational meeting, high schools, and executive investment clubs, AARP conferences, and business educational seminars for companies looking to educate their employees. Rich views his role as a Fiduciary for his clients as the single biggest key to any planning relationship and strives to provide the most competent, unbiased and objective advice in the financial planning profession today.

Over the years you begin to see a pattern of mistakes that people make with their 401ks. Considering that upwards of 66% of current workers retirement income will come from their savings, I’m amazed that people don’t pay more attention. So here goes… the top 10 mistakes I see people make in 401ks or 403bs:

They pick a bunch of funds when they get started, and never revisit, re-balance, or alter their holdings in any way from thence forward. Out of sight, out of mind.

They choose to invest in the top performing funds available at the time of their enrollment. Because this is usually done when they are initially hired, it doesn’t account for tends such as a dot.com bubble.

They fail to diversify across multiple asset classes. See number 2. I have seen a lot of investors that started investing in the 90s and never stopped investing in growth stocks. In more recent times, the same applies for international stocks.

They leave them with former employers, accentuating their mistakes in lack of management.

They ignore fees. Over time, fees can have a big impact on returns.

They manage too much. This is the opposite of number 1. Some people just choose the top performers from last year, and are constantly chasing returns. The problem here is that this investment philosophy usually buys high when things are hot, and sell low when things are not hot. It is not a disciplined long term investment philosophy.

They don’t save enough. If the majority of your income in retirement is going to come from your savings, most of you had better be putting at least 15% away.

They don’t take advantage of the match. If your company is going to match, it might not be a bad idea to at least save up to the match. If the plan is bad, you can put your other savings elsewhere.

They never sign up. Many people say they aren’t signed up because they know it’ll take away from their current paycheck, and they are living paycheck to paycheck right now. Try having to work when you are 80 because you need the money. Unfortunately, I’ve seen it.

They invest too much in the company stock. While this doesn’t occur too much after Enron, it can be fatal to your retirement goal, especially if you are anywhere near retirement. The same can be said for investing too much in 1 particular fund.

So there you have it. What are some other mistakes? If you are doing any of these, consider finding an objective fee-only NAPFA Registered Financial Advisor to review your 401k or 403b allocation and retirement plan. It could pay big dividends in the end. Pun intended.

About the author

Richard T. Feight, CFP®

Among independent financial advisors, Mr. Feight is one of the most well known and highly respected “Fee-Only” financial planners. Since 1997, Rich has dedicated his career to offering low cost “Fee-Only” comprehensive financial planning and investment advice. Rich assists his clients in organizing their finances so that they can retire on time.Rich is a graduate of Michigan State University where he received his degree in Finance. Rich has earned the Certificate of Financial Planning from The College for Financial Planning in Denver , Colorado that was comprised of intense graduate level classes grounding him in the various foundations of financial planning. He is a CFP® (Certified Financial Planner®) since 2001, meeting the experience, education requirements and passing the two-day, 10 hour exam, making him one of the few in the country who hold the designation. Since 2003, Rich has subscribed to the stringent and mandatory annual educational hours, experience, and code of ethics to meet the requirements to be a NAPFA Registered Financial Advisor. Out of the 800,000 individuals in the country who claim they are financial advisors/planners, fewer than 1,300 in the country qualify for the membership; Rich is one of them.

Rich is the President of the Financial Planning Association (FPA) of Michigan . The FPA of Michigan is one of largest and influential chapter in the country. Rich was recently named President for Transportation Toastmasters Club 4776 downtown Lansing . He has been quoted in both local and national media from Noise Magazine to CNBC, and Bloomberg, and industry news publications such as Investment News and Financial Advisor Magazine. Rich enjoys public speaking and has spoke at industry educational meeting, high schools, and executive investment clubs, AARP conferences, and business educational seminars for companies looking to educate their employees. Rich views his role as a Fiduciary for his clients as the single biggest key to any planning relationship and strives to provide the most competent, unbiased and objective advice in the financial planning profession today.